Give Me Some Background
Yes, back in 2012, the final ruling declared the ACA’s “individual mandate” a tax, and thus, constitutional. But now, there’s a new case--King v. Burwell which questions the legality of tax credits given to ACA users in states using HealthCare.gov. Under the law as it has been interpreted in practice, states were given the choice to use a federal marketplace in place of their own statewide exchange. Indiana and thirty-three other states chose this route. This made it possible for low- and middle-income households to qualify for tax credits they otherwise would not receive. The controversy with the tax-credit subsidies lies in a single phrase: “an Exchange established by the State.” Challengers argue this caveat makes it illegal to offer tax credits to anyone who is enrolled in ACA through healthcare.gov, but the Obama Administration insists this is a weak argument hinging on a technicality. Regardless, a ruling in favor of the challengers will equate to the Supreme Court turning their backs on families wanting affordable healthcare.
In Indiana, 218,617 Hoosiers selected qualified health plans (QHPs) during the 2015 open enrollment[i]. There are currently 159,802 Hoosiers receiving subsidies.
Why should I care?
Governor Mike Pence has stubbornly insisted that if SCOTUS sides with the challengers he does not want Indiana to take over the state’s exchange to preserve the subsidies. He instead suggests that Congress should give states “the ability to offer alternative healthcare solutions, crafted to the unique circumstances in their states[ii]”. If the subsidies were ruled unconstitutional, 159,802 Hoosier’s healthcare cost would increase 271%. * Attorney General Greg Zoeller led the way in for this case for Indiana by filing Indiana v. IRS, a precursor to the King case. The basics of the lawsuit agree with challengers in King v. Burwell, but specifically relate it to public school employees. Zoeller wanted to also challenge the letter of law and is seeking clarity on whether the state will be subject to the employer mandate tax penalties.
So what now?
If SCOTUS upholds the challenge backed by Governor Pence, 6 million Americans (including hundreds of thousands of Hoosiers) will be out of affordable health insurance. Supporters of the ACA say the phrase “an Exchange established by the State” does not exclude the exchange established by the federal government, and argue the IRS’s interpretation was reasonable. Taking 6 million Americans out of the exchange and causing even more to pay higher premiums is not just bad optics, it is bad policy. Allowing these subsidies to expire will impact individuals, small business, insurance markets, doctors, and hospitals. The Supreme Court is to set to decide soon, and Governor Pence will need to answer one important question: will he once again choose his stubborn politics over the wellbeing of Hoosier citizens? The College Democrats of Indiana know Governor Pence’s longtime opposition to the law complicates his re-election hopes, but a true leader should recognize the right thing to do regardless of the politics. His help initiating this dangerous court challenge, his insistence to fight common-sense solutions to save the subsidies, and his refusal to offer a workable alternative show, once again, that it is a time for a change of leadership in Indiana.
* Does not include rate increases that insurance companies would be expected to seek to make up for the fact that sicker people are the ones most likely to accept higher premium costs to keep their coverage.
[i] Wiechmann, S. (2015, January 16). 175,000 Hoosiers Enrolled Through Affordable Care Act So Far. Retrieved June 15, 2015, from http://indianapublicmedia.org/news/175000-hoosiers-enrolled-affordable-care-act-77029/
[ii] Groppe, M. (2015, June 15). Indy residents would be hard hit if Obamacare subsidies end. Retrieved June 15, 2015, from http://www.indystar.com/story/news/politics/2015/06/11/indy-residents-hard-hit-obamacare-subsidies-end/71094292/#_=_